Donald Charney v. Office of Personnel Management ( 2024 )

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD
DONALD KENNETH CHARNEY, DOCKET NUMBER
Appellant, PH-0831-19-0239-I-1
v.
OFFICE OF PERSONNEL DATE: June 14, 2024
MANAGEMENT,
Agency.
THIS FINAL ORDER IS NONPRECEDENTIAL 1
Donald Kenneth Charney , New York, New York, pro se.
Carla Robinson , Washington, D.C., for the agency.
BEFORE
Cathy A. Harris, Chairman
Raymond A. Limon, Vice Chairman
Henry J. Kerner, Member*
*Member Kerner did not participate in the adjudication of this appeal.
FINAL ORDER
¶1 The appellant has filed a petition for review of the initial decision, which
affirmed the Office of Personnel Management’s (OPM) final decision regarding a
Federal Employees’ Retirement System (FERS) annuity overpayment. Generally,
1
A nonprecedential order is one that the Board has determined does not add
significantly to the body of MSPB case law. Parties may cite nonprecedential orders,
but such orders have no precedential value; the Board and administrative judges are not
required to follow or distinguish them in any future decisions. In contrast, a
precedential decision issued as an Opinion and Order has been identified by the Board
as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
2
we grant petitions such as this one only in the following circumstances: the
initial decision contains erroneous findings of material fact; the initial decision is
based on an erroneous interpretation of statute or regulation or the erroneous
application of the law to the facts of the case; the administrative judge’s rulings
during either the course of the appeal or the initial decision were not consistent
with required procedures or involved an abuse of discretion, and the resulting
error affected the outcome of the case; or new and material evidence or legal
argument is available that, despite the petitioner’s due diligence, was not
available when the record closed. Title 5 of the Code of Federal Regulations,
section 1201.115 (5 C.F.R. § 1201.115). After fully considering the filings in this
appeal, we conclude that the petitioner has not established any basis under section
1201.115 for granting the petition for review. Therefore, we DENY the petition
for review. Except as expressly MODIFIED below regarding the existence and
amount of the overpayment, we AFFIRM the initial decision.
BACKGROUND
¶2 The following facts are undisputed. The appellant retired from Federal
service under FERS on January 3, 1999. Initial Appeal File (IAF), Tab 14
at 108-15. He was unmarried at the time and elected an unreduced annuity
payable only during his lifetime. Id. at 108. On March 21, 2005, the appellant
married. Id. at 42. On April 29, 2005, he appeared in person at OPM
Headquarters and completed the necessary forms to elect a reduced annuity to
provide survivor benefits for his wife. Id. at 28. It was not until 2014 that the
appellant realized that OPM had never reduced his annuity or otherwise put his
2005 survivor benefit election into effect. Id.¶3 On October 18, 2014, the appellant requested that OPM provide him with a
reduced annuity in accordance with his earlier election. Id. at 23. OPM denied
the request, but after the appellant filed a Board appeal, OPM rescinded its
decision and decided to allow the election. IAF, Tab 14 at 77, 80-85; Charney v.
3
Office of Personnel Management, MSPB Docket No. NY-0842-18-0033-I-1,
Appeal File, Tab 15. On June 15, 2018, OPM notified the appellant that he would
have 60 days to complete and return a survivor annuity election form. IAF,
Tab 14 at 46-51. OPM also notified the appellant that the election would be
retroactive to January 1, 2006, the first day after the 9-month period beginning
the date of his marriage. Id. at 46. It therefore informed him that, if he elected a
survivor annuity, he would be in an overpayment status due to his receipt of an
unreduced annuity since that date. Id. at 49. OPM also informed the appellant of
the estimated amounts of overpayment and proposed collection schedules,
depending on whether he elected a full or partial survivor benefit. Id. On or
about July 19, 2018, the appellant indicated his election of a full survivor benefit.
Id. at 41.
¶4 On August 7, 2018, OPM issued an initial decision, informing the appellant
that, due to his survivor annuity election, he had incurred an overpayment of
$28,487, which it intended to collect in 79 monthly installments of $360.30 and a
final installment of $23.30. 2 Id. at 33-36. The appellant filed a request for
reconsideration, challenging the amount of the overpayment and asking that it be
reduced to account for OPM’s delay in allowing the election. Id. at 18-21. On
April 12, 2019, OPM issued a final decision affirming its initial decision. Id.
at 15-17.
¶5 The appellant filed a Board appeal challenging OPM’s decision and again
requesting an adjustment to the amount of the overpayment. IAF, Tab 1. He
waived his right to a hearing. IAF, Tab 17, Initial Decision (ID) at 1. After the
close of the record, the administrative judge issued an initial decision affirming
OPM’s final decision. ID. She found that OPM proved the existence and amount
2
OPM’s June 15, 2018 estimate notified the appellant that, if he elected the full benefit,
he could expect to incur a $28,273 overpayment with a collection schedule of $360.30
for 78 months and a final installment of $179.80. IAF, Tab 14 at 49. Considering the
passage of time between this estimate and the appellant’s July 19, 2018 response, it
appears that the estimate was accurate.
4
of the overpayment, and that the appellant did not establish that the overpayment
should be waived or the collection schedule adjusted. ID at 3-5.
¶6 The appellant has filed a petition for review, arguing that the overpayment
should be recalculated to exclude the period of time that OPM had failed to
recognize his survivor annuity election. Petition for Review (PFR) File, Tab 1.
OPM has filed a response. PFR File, Tab 4.
ANALYSIS
¶7 OPM bears the burden of proving the existence and amount of an annuity
overpayment by preponderant evidence. Vojas v. Office of Personnel
Management, 115 M.S.P.R. 502, ¶ 10 (2011). In this case, the administrative
judge found that the appellant did not dispute the existence or the amount of the
overpayment. ID at 3. However, the appellant argues on petition for review that
he did dispute the amount of the overpayment. PFR File, Tab 1 at 4.
Specifically, he argued below, as he does on review, that “[t]he amount should be
recalculated to reflect the dates benefits would have been available.” IAF, Tab 1
at 4; PFR File, Tab 1 at 4. According to the appellant’s theory of the case, if he
had died before the date that OPM accepted his survivor annuity election, his wife
would not have received any survivor benefit. He argues that, because survivor
benefits were not actually available for his wife prior to OPM’s acceptance of the
survivor annuity election in 2018, he should not be required to pay for them as
though they were. IAF, Tab 1 at 4, Tab 6 at 4. The appellant asserted that he was
without fault and that “recovery would be against equity and good conscience,”
thus suggesting that he was seeking a waiver. IAF, Tab 6 at 4; see 5 U.S.C.
§ 8470(b); 5 C.F.R. § 845.301. However, he also stated that “the commencement
date used in calculating the overpayment is the sole issue in this case,” thus
suggesting that he was disputing the amount of the overpayment. IAF, Tab 6 at 4.
Construing this pro se appellant’s pleadings in the most favorable light possible,
5
we find that he was making two alternative arguments, the first disputing the
amount of the overpayment and the second requesting a partial waiver.
OPM proved the existence and the amount of the overpayment.
¶8 An employee who is unmarried at the time of retiring and who later marries
may irrevocably elect, within 2 years after the marriage, a reduction in his current
annuity in order to provide a survivor annuity for his spouse. 5 U.S.C. § 8416(c)
(1); Larson v. Office of Personnel Management, 93 M.S.P.R. 433, ¶ 7 (2003); 5
C.F.R. § 842.612(a).
¶9 The basic premise of the appellant’s argument for recalculating the
overpayment amount is that he did not make his survivor annuity election until
2018. However, we find that the appellant made his election in 2005, and that
OPM merely waited until 2018 to implement it. This is reflected in the language
of OPM’s initial and final decisions. IAF, Tab 14 at 15, 33. Moreover, accepting
the appellant’s argument would entail a finding that OPM waived the 2-year
statutory deadline for making the election, but OPM would not have been
authorized to do so under the facts of this case. There are only three possible
bases for waiving a statutory deadline, none of which apply here: (1) The statute
may provide for a waiver under specified circumstances; (2) an agency’s
affirmative misconduct may preclude enforcement of the deadline under the
doctrine of equitable estoppel; and (3) an agency’s failure to provide a notice of
rights and the applicable filing deadline, where such notice is required by law,
may warrant a waiver of the deadline. Lee v. Office of Personnel Management,
118 M.S.P.R. 604, ¶ 4 (2012). Regarding the first possibility, the statute itself
does not provide for waiver under the circumstances of this case. 3 Regarding the
3
Neither the Board nor the United States Court of Appeals for the Federal Circuit has
recognized any statutory waiver provision for the 2-year deadline in 5 U.S.C. § 8416(c)
(1). See, e.g., Schoemakers v. Office of Personnel Management, 180 F.3d 1377, 1381-
82 (Fed. Cir. 1999) (finding no statutory mechanism to waive the Civil Service
Retirement System (CSRS) survivor annuity election deadline based on mental
incapacity); see also Larson v. Office of Personnel Management, 93 M.S.P.R. 433, ¶ 7
(2003) (finding the FERS survivor annuity deadline to be “basically indistinguishable”
6
second possibility, although OPM may have been negligent in failing to effect the
appellant’s 2005 election, negligence does not amount to the affirmative
misconduct required to waive a filing deadline based on equitable estoppel. See
Nunes v. Office of Personnel Management, 111 M.S.P.R. 221, ¶ 19 (2009).
Regarding the third possibility, OPM submitted evidence that it mailed the
appellant the required annual notice of his survivor annuity election rights from
the date of his retirement through the close of the election period, and the
appellant has not rebutted this evidence. 4 IAF, Tab 14 at 90-93; see Cartsounis v.
Office of Personnel Management, 91 M.S.P.R. 502, ¶¶ 6-7 (2002). In sum, based
on the plain language of OPM’s decision letters and its inability to waive the
election deadline, we find that the appellant made his election in 2005, and not in
2018.
¶10 Moreover, even if the appellant had made his election in 2018, the statute
plainly requires that “[t]he election and reduction shall take effect the first day of
the first month beginning 9 months after the date of marriage.” 5 C.F.R.
§ 8416(c)(2). The statute makes no distinction between elections made during the
2-year period in 5 U.S.C. § 8416(c)(1) and elections made after the 2-year period.
Therefore, regardless of when the election was made, we find that OPM did not
err in making the election and reduction retroactive to January 1, 2006, the first
day after the 9-month period beginning the date of the appellant’s March 21, 2005
marriage. IAF, Tab 14 at 46.
¶11 Having found that the dates that OPM used to calculate the overpayment
were correct under the law, we agree with the administrative judge that OPM
provided sufficient evidence of its calculations to prove the amount of the
overpayment in question, and that the appellant did not rebut those calculations.
ID at 3; IAF, Tab 14 at 40. We therefore agree with the administrative judge that
from the CSRS survivor annuity deadline).
4
Even if OPM had not sent the required annual notice, the appellant’s 2005 survivor
annuity application shows that he was actually aware of his election rights during the
relevant time period.
7
OPM established the existence of an overpayment in the amount of $28,487. ID
at 3; IAF, Tab 14 at 15.
The appellant has not shown that recovery of the overpayment should be waived.
¶12 Recovery of an overpayment may not be made from an individual when, in
the judgment of OPM, the individual is without fault and recovery would be
against equity and good conscience. 5 U.S.C. § 8470(b); 5 C.F.R. § 845.301.
Generally, recovery of an overpayment would be against equity and good
conscience when: (1) it would cause financial hardship; (2) the recipient of the
overpayment can show that he relinquished a valuable right or changed positions
for the worse as a result of the overpayment; or (3) it would be unconscionable
under the circumstances. 5 C.F.R. § 845.303. The Board will consider all
relevant factors under a “totality of-the-circumstances” approach to determine
whether recovery of an annuity payment is unconscionable. Wilcox v. Office of
Personnel Management, 46 M.S.P.R. 377, 382-83 (1990). The annuitant bears
the burden of establishing his entitlement to a waiver by substantial evidence.
5 C.F.R. § 845.307(b); see also 5 C.F.R. § 1201.56(b)(2)(ii).
¶13 In this case, the administrative judge found that the appellant did not assert
financial hardship or detrimental reliance on the overpayment. ID at 4. She
considered the appellant’s argument that recovery would be unconscionable
because his wife would not have received the annuity benefit if he had died
during the time of the retroactive period, but she disagreed because the appellant
voluntarily elected the survivor annuity and was put on notice that his election
would create an overpayment. ID at 4-5.
¶14 To the extent that the appellant’s petition for review constitutes a challenge
to this finding, we agree with the administrative judge that recovery would
generally not be unconscionable when an overpayment resulted from a voluntary
election of alternative benefits, particularly where the exact amount of the
overpayment was known in advance. ID at 5. Moreover, we note that the
appellant’s argument is premised on a hypothetical that did not actually occur; the
8
appellant did not die during the period of retroactivity, and his wife was not
thereby denied survivor benefits due to OPM’s error. 5 Given that the appellant
survived this period, we find that he is now essentially seeking a windfall, to
avoid paying for the reduction in his basic annuity that would have occurred but
for OPM’s mistake. See Day v. Office of Personnel Management, 873 F.2d 291,
293 (Fed. Cir. 1989). OPM has now rectified its 2005 administrative error, and
the appellant is now no worse off for it. The principles of equity and good
conscience do not require that the Board make him better off than if the error had
not occurred. 6 Cf. Oates v. Department of Health and Human Services ,
64 M.S.P.R. 349, 351 (1994) (finding that status quo ante relief does not require
that an individual be placed in a better position than if the challenged action had
not occurred).
NOTICE OF APPEAL RIGHTS 7
The initial decision, as supplemented by this Final Order, constitutes the
Boards final decision in this matter. 5 C.F.R. &sect 1201.113. You may obtain
review of this final decision. 5 U.S.C. § 7703(a)(1). By statute, the nature of
your claims determines the time limit for seeking such review and the appropriate
5
Even if the appellant had died during the period of retroactivity, there would have
been nothing to prevent his wife from actually obtaining survivor benefits by
challenging OPM’s failure to process the 2005 survivor annuity election. See generally
5 U.S.C. § 8461(e)(1) (providing Board appeal rights to individuals whose rights or
interests under FERS are affected by an agency decision).
6
OPM has advised the Board that it may seek recovery of any debt remaining upon an
appellant’s death from the appellant’s estate or other responsible party. A party
responsible for any debt remaining upon the appellant’s death may include an heir
(spouse, child, or other) who is deriving a benefit from the appellant’s Federal benefits,
an heir or other person acting as a representative of the estate if, for example, the
representative fails to pay the United States before paying the claims or other creditors
in accordance with 31 U.S.C. § 3713(b), or transferees or distributers of the appellant’s
estate. Pierotti v. Office of Personnel Management, 124 M.S.P.R. 103, ¶ 13 (2016).
7
Since the issuance of the initial decision in this matter, the Board may have updated
the notice of review rights included in final decisions. As indicated in the notice, the
Board cannot advise which option is most appropriate in any matter.
9
forum with which to file. 5 U.S.C. § 7703(b). Although we offer the following
summary of available appeal rights, the Merit Systems Protection Board does not
provide legal advice on which option is most appropriate for your situation and
the rights described below do not represent a statement of how courts will rule
regarding which cases fall within their jurisdiction. If you wish to seek review of
this final decision, you should immediately review the law applicable to your
claims and carefully follow all filing time limits and requirements. Failure to file
within the applicable time limit may result in the dismissal of your case by your
chosen forum.
Please read carefully each of the three main possible choices of review
below to decide which one applies to your particular case. If you have questions
about whether a particular forum is the appropriate one to review your case, you
should contact that forum for more information.
(1) Judicial review in general . As a general rule, an appellant seeking
judicial review of a final Board order must file a petition for review with the U.S.
Court of Appeals for the Federal Circuit, which must be received by the court
within 60 calendar days of the date of issuance of this decision. 5 U.S.C.
§ 7703(b)(1)(A).
If you submit a petition for review to the U.S. Court of Appeals for the
Federal Circuit, you must submit your petition to the court at the
following address:
U.S. Court of Appeals
for the Federal Circuit
717 Madison Place, N.W.
Washington, D.C. 20439
Additional information about the U.S. Court of Appeals for the Federal
Circuit is available at the court’s website, www.cafc.uscourts.gov. Of particular
relevance is the court’s “Guide for Pro Se Petitioners and Appellants,” which is
contained within the court’s Rules of Practice, and Forms 5, 6, 10, and 11.
10
If you are interested in securing pro bono representation for an appeal to
the U.S. Court of Appeals for the Federal Circuit, you may visit our website at
http://www.mspb.gov/probono for information regarding pro bono representation
for Merit Systems Protection Board appellants before the Federal Circuit. The
Board neither endorses the services provided by any attorney nor warrants that
any attorney will accept representation in a given case.
(2) Judicial or EEOC review of cases involving a claim of
discrimination . This option applies to you only if you have claimed that you
were affected by an action that is appealable to the Board and that such action
was based, in whole or in part, on unlawful discrimination. If so, you may obtain
judicial review of this decision—including a disposition of your discrimination
claims —by filing a civil action with an appropriate U.S. district court ( not the
U.S. Court of Appeals for the Federal Circuit), within 30 calendar days after you
receive this decision. 5 U.S.C. § 7703(b)(2); see Perry v. Merit Systems
Protection Board, 582 U.S. 420 (2017). If you have a representative in this case,
and your representative receives this decision before you do, then you must file
with the district court no later than 30 calendar days after your representative
receives this decision. If the action involves a claim of discrimination based on
race, color, religion, sex, national origin, or a disabling condition, you may be
entitled to representation by a court-appointed lawyer and to waiver of any
requirement of prepayment of fees, costs, or other security. See 42 U.S.C.
§ 2000e-5(f) and 29 U.S.C. § 794a.
Contact information for U.S. district courts can be found at their respective
websites, which can be accessed through the link below:
http://www.uscourts.gov/Court_Locator/CourtWebsites.aspx .
Alternatively, you may request review by the Equal Employment
Opportunity Commission (EEOC) of your discrimination claims only, excluding
all other issues . 5 U.S.C. § 7702(b)(1). You must file any such request with the
11
EEOC’s Office of Federal Operations within 30 calendar days after you receive
this decision. 5 U.S.C. § 7702(b)(1). If you have a representative in this case,
and your representative receives this decision before you do, then you must file
with the EEOC no later than 30 calendar days after your representative receives
this decision.
If you submit a request for review to the EEOC by regular U.S. mail, the
address of the EEOC is:
Office of Federal Operations
Equal Employment Opportunity Commission
P.O. Box 77960
Washington, D.C. 20013
If you submit a request for review to the EEOC via commercial delivery or
by a method requiring a signature, it must be addressed to:
Office of Federal Operations
Equal Employment Opportunity Commission
131 M Street, N.E.
Suite 5SW12G
Washington, D.C. 20507
(3) Judicial review pursuant to the Whistleblower Protection
Enhancement Act of 2012 . This option applies to you only if you have raised
claims of reprisal for whistleblowing disclosures under 5 U.S.C. § 2302(b)(8) or
other protected activities listed in 5 U.S.C. § 2302(b)(9)(A)(i), (B), (C), or (D).
If so, and your judicial petition for review “raises no challenge to the Board’s
disposition of allegations of a prohibited personnel practice described in
section 2302(b) other than practices described in section 2302(b)(8), or 2302(b)
(9)(A)(i), (B), (C), or (D),” then you may file a petition for judicial review either
with the U.S. Court of Appeals for the Federal Circuit or any court of appeals of
competent jurisdiction. 8 The court of appeals must receive your petition for
8
The original statutory provision that provided for judicial review of certain
whistleblower claims by any court of appeals of competent jurisdiction expired on
December 27, 2017. The All Circuit Review Act, signed into law by the President on
July 7, 2018, permanently allows appellants to file petitions for judicial review of
12
review within 60 days of the date of issuance of this decision. 5 U.S.C.
§ 7703(b)(1)(B).
If you submit a petition for judicial review to the U.S. Court of Appeals for
the Federal Circuit, you must submit your petition to the court at the
following address:
U.S. Court of Appeals
for the Federal Circuit
717 Madison Place, N.W.
Washington, D.C. 20439
Additional information about the U.S. Court of Appeals for the Federal
Circuit is available at the court’s website, www.cafc.uscourts.gov. Of particular
relevance is the court’s “Guide for Pro Se Petitioners and Appellants,” which is
contained within the court’s Rules of Practice, and Forms 5, 6, 10, and 11.
If you are interested in securing pro bono representation for an appeal to
the U.S. Court of Appeals for the Federal Circuit, you may visit our website at
http://www.mspb.gov/probono for information regarding pro bono representation
for Merit Systems Protection Board appellants before the Federal Circuit. The
Board neither endorses the services provided by any attorney nor warrants that
any attorney will accept representation in a given case.
MSPB decisions in certain whistleblower reprisal cases with the U.S. Court of Appeals
for the Federal Circuit or any other circuit court of appeals of competent jurisdiction.
The All Circuit Review Act is retroactive to November 26, 2017. Pub. L. No. 115-195,
132 Stat. 1510.
13
Contact information for the courts of appeals can be found at their
respective websites, which can be accessed through the link below:
http://www.uscourts.gov/Court_Locator/CourtWebsites.aspx .
FOR THE BOARD: ______________________________
Gina K. Grippando
Clerk of the Board
Washington, D.C.